Fannie Mae, Freddie Mac and the Federal Home Loan Banks will now be prohibited from taking on mortgages “encumbered by certain types of transfer fee covenants and in certain related securities” under a final rule issued last week by the Federal Housing Finance Agency. The FHFA’s final rule, published in the March 16 Federal Register, generally applies, with some exceptions, to private transfer fee covenants created on or after Feb. 8, 2011, the publication date of the Finance Agency’s proposed rule.

Effective Sept. 1, Freddie Mac will assess a Reporting Noncompliance Compensatory Fee of up to $15,000 on servicers that fail to report on at least 75 percent of the loans they service by the fifth business day after the accounting cycle cutoff, the GSE noted in an alert to servicers last week. Freddie has upped the fine it will levy from $250 to $5,000 against any servicer that falls short of the GSE’s reporting rules. A second violation in one 12-month period will result in a $10,000 fine, previously $550.

A conservative, non-partisan public interest group has filed suit against the Federal Housing Finance Agency, claiming the FHFA has improperly denied the group’s request for documents relating to the Finance Agency’s decision to sue 17 financial institutions last fall on behalf of Fannie Mae and Freddie Mac over alleged misrepresentations of mortgage-backed securities.Last week, Judicial Watch filed its lawsuit in the U.S. District Court for the District of Columbia after the FHFA denied the group’s Freedom of Information Act request for documents related to the agency’s litigation. The Finance Agency argued that as private companies, FOIA requests do not apply to Fannie and Freddie.

Mortgage lenders, private mortgage insurers and the government-sponsored enterprises remained at loggerheads on the nagging problem of loan buybacks and MI cancellations as 2011 came to a close. Despite several “global” settlements by the GSEs and halting progress on legal wrangling over representation and warranty claims related to non-agency mortgage-backed securities, a new Inside Mortgage Trends analysis reveals there were more unresolved buyback demands at the end of 2011 than there were at the beginning of the year. A clear sign of the persistent seriousness of...(Includes two data charts)

The expanded Home Affordable Refinance Program barely got off the launch pad in December, but more recent data and anecdotal reports suggest that the revamped mission to help underwater Fannie and Freddie borrowers is flying higher in early 2012. Even as the government-sponsored enterprises were reporting a 5.0 percent increase in refinance activity in December, the number of new HARP loans declined by a whopping 35.8 percent from the previous month. HARP activity increased by 3.3 percent from the third to the fourth quarter of last year, but that was significantly...(Includes two data charts)

The recent Servicing Resolution Agreements signed by the nation’s top five mortgage servicers with the federal government and state attorneys general may have been clear on the cost of their key provisions but it is the enormous hidden costs of compliance that could bite the financial institutions in the long run, according to compliance experts. Following the recent announcement of the national servicing settlement, it is impossible to put an accurate dollar amount on the myriad things servicers need to do in order to comply, but experts agree that staffing, training, technological upgrades...

Nationstar Mortgage Holdings says the deal it announced earlier this month to purchase $63 billion of mortgage servicing rights from Aurora Bank FSB, a subsidiary of Lehman Brothers Bancorp Inc., is part of the servicer’s long-term strategy to drive future growth. Texas-based Nationstar, the home finance unit of Fortress Investment Group, said the purchase represents all of Aurora’s servicing with 75 percent of the loans in non-agency mortgages, comprising approximately $45 billion of Aurora-serviced non-agency loans. Aurora serviced $34 billion of Alt A and negative amortization loans and about $10...

Ally Financial may be getting closer to ridding itself of its non-agency mortgage unit, ResCap, the residual of a business formerly known as Residential Capital that helped invent the jumbo securitization and Alt A markets. According to reports, Ally is weighing putting ResCap into bankruptcy as a prelude to selling the business to Fortress Investment Group or another suitor. Ally’s primary mortgage business, GMAC Mortgage, is a top seller-servicer in the agency market. ResCap and GMAC Mortgage are separate entities that are both subsidiaries of the holding company that also owns Ally...

Mobile devices have increasingly become tools that consumers use for banking, payments, budgeting and shopping, according to a new Federal Reserve report that offers useful business intelligence for mortgage lenders and technology vendors. The ubiquity of mobile phones is changing the way consumers access financial services, the Fed found. Twenty-one percent of mobile phone owners have used mobile banking in the past 12 months, and 11 percent of those not currently using mobile banking think that they will probably use it within the next 12 months. The most common use of mobile banking is to check account...

Buried in the fine print of the $25 billion nationwide servicing settlement is a small incentive for the five banks if they agree to waive their right to seek deficiency judgments against distressed borrowers. The five servicers agreed to make some $17 billion in loan modifications and refinances, but they meet those obligations by racking up “credits” for a long list of actions. For every dollar of principal reduction made on a portfolio mortgage with a loan-to-value ratio under 175 percent, for example, they get a dollar of credit toward their obligation. The agreement gives them credit for...